Friction is like transaction costs. For business economists, this is often overlooked or treated as an afterthought, yet solving the transaction-cost problem is the critical driver of most business structures. The Friction Project, by two Stanford business professors, makes an interesting observation on the impact of friction on business success. What is interesting is that sometimes it is important to reduce friction to make decisions easier. Still, there are also times when friction, slowing things down, and making decisions harder can be beneficial.
The job of a manager is to cut through friction, another way of making businesses more efficient. For example, make memos shorter. Make meetings more focused. Friction adds to the grind of impediments to increasing productivity. Look for frictions and then cut them. Friction can also be used as a tool to make it more difficult to switch or decide. Yet, frictions may mask bigger problems.
Transaction costs often seem so abstract, so I like the descriptive word “friction” as a better way to identify impediments to getting things done.
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